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Is a real estate license worth it? – What no one tells you

Why do real estate agents do what they do? Ask them and they’ll tell you that they love helping people find properties that suit them. Whether it’s a young family buying their first home to grow in and make cherished memories or a business owner in need of the perfect space for the company to flourish, real estate agents have a knack for finding these places and understanding the needs of their clients.

Many people decide to go into real estate after years of a career in another field or to do it on the side to make money with investments. Is a real estate license worth it? Yes, it is!

When you get your real estate license, it can boost your investing career. You’ll be able to network with other licensed agents, find the best deals, and make more of that beautiful green money through commissions and incentives.

Of course, the catch is that you have to put some effort, time, and investment into obtaining a real estate license. You don’t just pay a fee and get a real estate license. A lot more goes into it and there’s a lot no one tells you about.

That’s why I’m here. I want you to know getting a real estate license is definitely worth your time. But I also want you to know those lesser-known things so you can go in with no surprises and have the best chance to thrive at this new stage in your life. Keep reading and I’ll cover it all.

Will becoming a real estate agent help with your investing career?

Most investors don’t even think of how having a real estate license can be such a huge asset. If you’re reading this now, perhaps you didn’t think of it either. But yes, if you become a licensed real estate agent, you will most certainly boost your investing career.

How can it help?

When you’re a licensed real estate agent, you get the privilege of accessing properties only available on the MLS (Multiple Listing Service). This will help you get big commissions while increasing your network of professional contacts. This is always a good thing to have though you need to be sure you can handle this as opposed to merely hiring an agent yourself to do these things.

But remember, that nothing that’s worth having is easy to obtain so if you want to be a great investor, become a licensed real estate agent. This won’t be the right path for all of you, but for many of you, you will find this to be one of the smartest tactics you’ve ever tried.

Sure, you can hire a real estate agent to handle your property investments. But when you become one yourself, you get to personally put your hand into all the benefits without having to work with anyone else. That means you get to see all the properties available and you can network your own deals, profiting from the commission without having to share a cut with an agent that represents you. That’s really good money right there.

For anyone short on time, working with a licensed agent might best suit you. But if you’re starting your venture into investments and this is the journey you want to take, make the time to get your real estate license and you’ll see those big commission results you’ve been dreaming of.

It’s not just for making commissions though. If you want to manage a property, it’s very important to know everything there is to know before you dive right in. In some states, it’s mandatory to have a real estate license to be a property manager.

Keep reading and I’ll shed more light on this and why you’ll want to get your real estate license.

You may need a real estate license to manage a property

Let’s talk about California as an example since real estate is hot there right now. According to the California Business and Professional Code, you must have a real estate license for certain acts that involve real estate. There are exceptions for property managers though. Basically, according to section 10130, only a person with a real estate license can solicit tenants, negotiate leases, or collect the rent.

What that means is if you owned the property and hired a property manager, that person needs a real estate license. A property manager without one is pretty useless because if you hire one without licensing then they can’t conduct leasing or collect the rent. That’s not exactly beneficial to you now is it?

What you could do though is go for one of the other exceptions. See, this code doesn’t apply if the property manager lives on-site. So you could get away with having a property manager that doesn’t have a real estate license if they reside in the property. Employees of that manager don’t need a license either.

Off-site people that perform particular activities with these apartments don’t need licenses either if they’re employed by a licensed property manager. That means they can show the rentals to potential tenants, handle the rental applications, take deposits, collect fees and rent, and give information about the property. Basically, that includes most property management duties but the difference is that you need a licensed broker or salesperson that’s in charge of everything.

What would be most ideal? Having your own real estate license. Keep reading and I’ll tell you what those are!

Benefits Of having a Real Estate License

There really are so many things to gain by taking the time to get your own real estate license. You’ll earn your own commissions and make quite a bit of money, and isn’t that your goal?

Here are the benefits you’ll get from getting your real estate license.

– You’ll have access to the MLS

One of the best things about becoming a real estate agent is that you’ll get to see that Multiple Listing Service. That’s what all agents use to see what is available on the market. As an investor, you can pursue those without any middleman and negotiate your own deals at the best rates.

A friend of mine has done this for years. After having her children, she still kept her real estate license current and shows homes. But she also uses it as a way to make deals and doesn’t have to be present full-time to make them happen. What she did was incredibly smart. I’ll explain in a moment.

– Real estate agents can make great money

Yes, real estate agents only make commissions. So, until they make a sale, they get nothing. But those commissions can really add up. In the meantime, as an investor, you’ve likely got other income coming in and are budgeting for variable income anyway. This would be no different.

Sure, it’s risky but so is investing and something tells me that if you’re here, you thrive on that risk. You know that it pays off. It truly does because those commission-based jobs have unlimited earning potential. When you work for someone else, even if you climb the corporate ladder and draw a hefty salary, you’re still 1) working for someone else and 2) limited in terms of growth of income. That doesn’t happen in real estate.

There are some real estate agents that bring in millions a year. It’s not luck though. These people work hard to make those sales. It takes great effort but it is worth it to get the kind of income you deserve.

Realistically, you have the potential to make much more money as a real estate agent. You get commissions paid by those selling the property which are negotiable by law. Some agents will make 2.5% of the purchase price on the contract and offer the same to the agent for the buyer though it will vary.

Let’s do an example to help illustrate this point. Say you sell a home that goes for $300,000. And let’s use that 2.5% rate. That’s $7,500. Then you have the brokerage split which is how brokers make their money to use the brand name and offices. For newer agents, you generally have to fork over a bit more because you need more training. Generally, you might have to give a 70/30 split to the brokerage firm which would still give you $5,250. And that’s just for selling one house.

What if you sold one $300,000 house per month? See where I’m going with this?

You’ll want to sell as many properties as you can as quickly as you can. Don’t forget the escrows are usually 30 days and if you’re representing the buyer, you will have to shuttle them around to see properties. You’ll be putting in a lot of time to make the sale, but once you get into a grind with it, you’ll start finding it faster and easier to do.

– You’ll have a flexible schedule

Good news if you hate having to turn up to a job between the hours of 9 and 5. Real estate agents get to work the hours that work for them. If you like socializing and networking, being a real estate agent is perfect for you. Investors generally do well at this because networking and cultivating relationships comes so easily for them. Imagine just showing up to a few key events such as open houses and finding new clients to work with.

You’ll need to show properties when the clients are ready to see them and you won’t be confined to a desk all day. Having the quote-on-quote, freedom to set your own schedule is a beautiful thing!

– You can be a real estate agent part-time

When you’re first starting out into real estate, going in part-time is one of the smartest ways to do it. This is because you have to build a list of clients. So it helps to be doing something else and making the transition into a full-time real estate agent. Or even just keeping it on the side while you run your other investments.

Keep in mind that most people don’t get their real estate license and then sell their first house the next day. It will take time to turn a profit, but once you do, you’re going to continue to have success and make lots of money.

It’s a great job to have if you have children too. My friend I mentioned above (her name is Jill) was a full-time real estate agent before getting married and having kids. She has always kept her license current because she loved doing it. Jill is by nature a very outgoing person. People gravitate toward her. Last week, she called me to tell me she sold a house to the parents of a boy that is in her son’s class. It just fell into her lap.

With the part-time and flexibility of being a real estate agent, you can work at home and get everything in order there. Now that both of Jill’s kids are at school all day, she tends to do showings while they’re in school. In the summer, she will send them to camp so she can do what she needs to do. When they were younger, she’d wait until her husband came home or hire a sitter so she could take clients to showings.

Jill does it for the thrill of helping people and making more money a month even working part-time for herself (and devoting the rest of her time to the PTA). However, plenty of other people do it so they can buy and sell their own properties. Here’s why!

– You control all your deals

Why would you want to get into real estate as an investor? Because you are your own agent with all the control now when you buy properties. When you sell your own homes and properties, you have the ultimate control. You set the bottom line sale price. You set the payment terms. You call the shots. And you work directly with the lender, inspectors, appraisers, closing lawyers, and escrow company.

As an investor, you’ve already got the business mind for such things so why not be the one holding the reins the entire time?

– Chances to network

Real estate agents are always invited to industry events. If you have a real estate license, you, as the investor, now get to attend them. This helps you grow your client roster and make way for more earnings.

– Access to resources and tools

When you get a real estate license, you increase your access to those tools and resources that you wouldn’t normally get the chance to use. That real estate license is like taking the golden key to unlock the door to further income potential.

– Added credibility

That real estate license will instantly add more credibility to your profile. An investor with these credentials who not only talks the talk but also walks the walk is more appealing to both buyers and sellers.

Disadvantages of Real Estate License

I think the advantages of having a real estate license as an investor far outweigh any disadvantages, but what I do here is give you all the facts so you can make the decision that fits you best. As great as getting your real estate license is, there are a few things you should consider.

– You can’t buy property from any brokerage

Once you get your real estate license, you can’t just go and do those deals yourself. You have to earn your license by working with a broker. So you’d need to work with a brokerage firm or a broker until you get your brokerage license.

– There will be disclosure issues

When you get licensed, you must disclose to buyers and sellers that you’re a real estate agent. You won’t be permitted to take advantage of a situation. That means it could have a negative impact on your portfolio and business growth.

– People will ask you for kickbacks

As a real estate agent, people will ask you for kickbacks. Some will be of the legal variety while others won’t be. Expect both buyers and sellers to haggle with your over your commission.

– It’s expensive to get a real estate license

You probably knew this going into it but getting your real estate license is a pricey process. You first have to join courses that prepare you for the real estate exam. You have to pay a fee and join a bunch of organizations for your license too. Then once you do get that license, you have to work under a broker which takes up more than your money… it takes up time too.

And while you’re working under a broker, you are still an independent contractor. To put it another way, you could be part of one of the big brokerage firms like RE/Max or Coldwell Banker. You get to put that on your card. But you buy those cards yourself and you’re responsible for your own success. Don’t forget that those open house and sale signs are your financial responsibility. And if you’re not tech-savvy, you may want to hire someone to help you create a website.

You should probably plan on $1,000 for the start-up expenses of advertising and then you should be prepared to throw more money at it later on. There are also the dues you have to pay to the board, membership fees for MLS, and annual real estate association fees that you need to pay. When starting out as a real estate agent, most people choose to work with buyers to get their feet wet rather than with sellers. House-hunting with hopefully families means you’ll be investing a lot in your car and the gas to fuel it up as you drive them all over town.

– Your hours will be odd

While some people will really find the unusual hours refreshing, others might not. Plus, you will get calls from people you don’t know asking to meet you at properties immediately! It can get tricky trying to manage your time. Many houses are shown on weekends or in the evenings as most people work standard hours and have to wait until they’re available to see the home.

Do know that just because someone wants to see the house RIGHT NOW doesn’t mean you need to jump through hoops of fire though. You can set polite boundaries with a professional message on your voicemail. Just be sure to be prompt with replies.

My neighbors bought their home from their real estate agent because she was the first person to respond to their inquiry and she happened to be on her vacation. They were thrilled with her. While you set boundaries and this woman did too, you will need to make exceptions for closings and negotiations so keep this in mind while you enjoy waking up later and starting your day later.

As for messages, keep yours professional and list the hours you keep. This way, potential clients know what to expect for when you’ll return their calls.

– Be prepared to deal with doubts

If you love sales and you love people, real estate should come easily to you. But both buyers and sellers have their own personalities. Some will be dream clients while others will lie or accuse you of lying and it can get very stressful. You’ll have those that allow you to take the reins and trust in you while others will hover over your every move. Because every personality is different, you’ll find yourself juggling clients that span this entire spectrum.

– Hope you like paperwork

After you get your license, you’ll get even more paperwork. Any real estate agent will tell you that they could spend at least two full days a week on their paperwork alone. If you like paperwork or have someone you can hire to sift through it, it won’t really bother you. And even if you don’t, if you’re driven, you’ll jump over any hurdle to achieve your dream.

– You may not like the MLS

One advantage that I listed above is the MLS. You get access to this by being a licensed real estate agent. But you also must be a member of your local real estate board and pay the fees associated with it. You also need to be part of a brokerage to get access to it. And that access is indeed worth getting plenty of information. However, there are real estate search engines you can use that don’t have the fees.

Any further liabilities and advantages that come with having a real estate license?

In most states, you can proceed with a real estate transaction without a licensed agent. But when you don’t have one (or aren’t one yourself), the responsibility is all yours. That can be a bad thing. So when you get your real estate license, that changes everything for the better.

As I mentioned above with both benefits and disadvantages, this would be one huge benefit for you. Having the title of ‘licensed real estate agent’ means you have responsibilities but you also have a major advantage as an investor over the other party in the deal at hand.

That responsibility means you’re subject to complaints with the state, or even litigation in some cases too. But that shouldn’t stop you. For when you invest in real estate, it aligns with high risk. And as an investor, you’re used to risk. Buyers and sellers both bring up litigation for both statutory and common law but you can mitigate this risk by investing into your career as a licensed real estate agent. By following the rules, you’ll avoid problems in this regard.

The other added benefit of going ahead and getting that real estate license is that you’ll be more educated about real estate. And the more educated you are about it, the less likely you are to encounter litigations and other hassles. Yes, your responsibilities will swell but your risk really is no more than it currently is as an investor. Follow all legal procedures to a T and you’ll find having a real estate license is one of the best things you can ever get to bolster your portfolio.

Requirements to get a real estate license

Of course, there’s a bit more to getting your real estate license than simply paying fees, taking classes, passing tests, and working with a broker. There are certain requirements you must meet in order to be eligible. While they will vary slightly by state, keep reading and you’ll find out what the general requirements are.

– Requirements for age

By law in most states, you must be a legal adult, at least 18 years of age, to become a real estate agent. If you’re just now 18, you may find the industry dominated with older, more experienced agents. Don’t let it stop you though. It can be tough competition but if you like a challenge, go for it. Your enthusiasm and energy coupled with eagerness can take you far and if you play your cards right, you’ll build a strong network of mentors that can help you become a huge success as a real estate agent.

– Formal educational requirements

Depending on which state you reside in, you will most likely need to graduate from high school in order to go for your real estate license. Some states don’t even require you to finish your high school education to obtain your real estate license. Because each state has different requirements on this, it helps to know what is expected before getting your hopes dashed. Rarely is college or tech school required beyond that, though again, check with your state.

– Professional real estate education requirements

Every state has a pre-licensing education requirement you need to complete so that you’re permitted to take the exam. The hours required and the course curriculum are mandated by the real estate commission for your state. Any schools that provide real estate pre-licensing education must meet the requirements for your state.

As I mentioned before, it all varies by state. For example, in California, you must take three real estate classes which total 135 hours at either a college or private real estate school. Texas requires 210 hours of pre-license education. Both are among the strictest in the country for obtaining a real estate license.

There are also plenty of states that require you to finish a post-course exam, administered by the school where you obtained your pre-licensing education. You need to get a good score to qualify.

– Requirements for post-licensing

Some states also mandate a requirement for a post-licensing education. Some call it a first renewal. Regardless of what you want to call it, you may be required to complete this once you’ve passed your real estate license exam.

It’s a class or even a series of classes that you have to finish to change the standing on your license from probationary to full license. Florida, California, and Texas are among the states that require it but again, check in your area so you know what you’re facing on your path to becoming a real estate agent.

– Continuing education requirements

Then the day will come when you’re received your license. You’ve met the post-licensing requirements. And now, you will be required to complete state-approved real estate education. This is usually a designated number of hours over a specified amount of time.

It makes sense that in any field, you should always be growing and learning. Real estate requires you to keep it current. In some states, it’s annually. Other have it as multi-year renewal periods. And even others will have renewal deadlines that might begin on your birthday or the anniversary of when you got your real estate license, like a driver’s license.

You’ll have to see which requirements your state enacts and follow along with them. Generally, you can find this out from the same place you take your real estate courses. They should have plenty of literature about current statutes and requirements in your state.

– Exam requirements

While every state varies on particulars, all of them require you to complete a real estate licensing exam administered by the state. You won’t be able to get your real estate license without it. You should be well-versed in the laws of your own state, however, it will often include a national section.

This means you should be prepared to understand all facets of real estate for the US. That’s not to say that if you’re living in California and becoming a real estate agent there that you would need to know very specific things in Idaho, but you should make sure you’re studying everything you need to so that you score well.

Both the national and state-specific sections of your exam are to see how well you understand real estate practices, terminology, and policies. Because states vary, the one thing that shouldn’t is the basic knowledge of all realtors across the country. You can go it alone and study up on what you need to but you should take advantage of real estate exam prep courses.

Just like college exam preparatory courses for SAT and ACT, there are courses that can help you prepare for acing your real estate exam. They’re usually not free though so prepare to factor this cost into your investment into becoming a licensed real estate agent.

Still, these classes can help you review those important concepts from the pre-licensing portion of obtaining your license. You can help cement this information into your brain and further your chances for success.

– Affiliations with brokers

Once you pass all the required testing and have your real estate license, you’re not allowed to start out as a real estate agent just yet. You need to choose a broker to work with. Brokers can help you with support to help you get going in your real estate career. There are many advantages of this, and while it may seem like a hindrance, setting up with a notable brokerage can give you brand recognition until your name becomes a coveted utterance in your specific location.

– Requirements to get a license for real estate in your state

As every state varies and it would be an absolute drag to list out every little detail here, I’ll spare you that. But if you’re interested in furthering your investment portfolio by becoming a licensed real estate agent, you should definitely pursue it.

Most states require a basic education of a high school diploma but not all of them do. In Illinois, Maine, Nebraska, and New Jersey for example, a GED is also accepted. Several other states make this exception too.

You should also know that having a clean criminal record is desired too. Most states will run a background check on you. If you are a law-abiding citizen, this shouldn’t worry you.

So now that you’re ready to get your real estate license so you can expand your income and your investment potential, here’s how you get it!

How to Get a Real Estate License

If you’ve read up to this point, you might be thinking it’s a lot of work to get your real estate license. They don’t just hand these things out, you know. If you can devote the time and money to it, it’s worth it. You’ll be among the elite that can handle challenges like this and step up in any market. Here’s what else you need to know about getting that real estate license.

– Know the requirements for your state

Again, EVERY state has requirements for education and licensing. It’s all different so check with the local real estate commission in your state. You can look online or call them up. I recommend confirming anything you find out with someone at the commission as sometimes, updates occur and you want to be sure you have the most current information. It would be disappointing to prepare for something and suddenly learn that more is required of you.

– Take a pre-licensing course

It takes a lot of time and money to become a real estate agent, but it’s a worthy investment for many people. If you like taking risks and investing and you like to talk to other people, this is a great way to make more money and bolster your career. Still though, you need to be prepared for all that’s required. Knowing what your local real estate commission requires will help you prepare and budget for these expenses.

– Pass the exam

After you take those pre-licensing courses, you’ll have to pass the exam. It takes 1.5 and 3.5 hours to complete, depending on your state. Exam fees can be as little as $15 or even up to $60. You should also get an official real estate certification or transcript from the school plus a copy of your exam score so you can include it with your application for your real estate license.

– File your application

Go out and celebrate your success for passing your real estate exam. Then, submit the required items to get your real estate license. You’ll need to include the license application, your test results, and the fees. It can cost anywhere from $50 to $250. Most states will require a background check to the tune of $40 to $80. After submitting everything, it’s a waiting game. Some will get their license in a week while in other busier areas, it could take them up to 2 months to go through the processing.

– Get with a real estate brokerage

Next, you’ll need to join a real estate brokerage. This is an office that teams up real estate agents where you can generate your income. You should start looking for brokers to work with before you complete your training course. All those networking events will completely pay off when you join a brokerage, plus with the iconic logo of that brokerage on your card, you’ll be able to generate trust with buyers and sellers even when you first start out.

– Become a member of the National Association of Realtors (NAR)

You are not an official realtor until you join NAR. The National Association of Realtors requires you to join to become a full-fledged real estate agent. You won’t be allowed to access the MLS if you don’t. Fees are required and keeping your membership up to date is important to be in this exclusive network.

– Renew your real estate license regularly

Real estate licenses require renewing over time. It depends on the state you’re in for when that renewal must occur. Don’t go through all this hard work just to let it lapse!

I mentioned my friend Jill earlier. She took many years off raising her sons but still kept her real estate license current. This allowed her to keep on with being a realtor and generating income for her family even on a part-time basis. The renewals are generally every two to four years so keep yours current. Even if you do decide to take a break, you won’t have to go through the whole process all over again if you keep your license in good standing.


If you’re afraid of hard work or you don’t like working with people, perhaps real estate isn’t for you. But chances are, if you’re an investor or entrepreneur, you like making deals and working with others. Real estate is a natural move for you, one that can help you close bigger deals and bring in more money.

By investing in yourself as a real estate agent, you can get into bigger investment opportunities and make bigger profits. Even doing it part-time can give you significant gains so go for it!


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